NASHVILLE, TN — Metro’s council shouldn’t hurt employment by limiting cash advance business hours, according to Nashville’s Chamber of Commerce, and the councilman proposing limits says those services hinder redevelopment efforts.
That was Round 2 in a fight between a councilman who says his proposed ordinance would suppress crime and help economic development. In the other corner is a cash advance store proprietor who says he’s fighting for his 24/7-business model, explaining that if the bill becomes law it’ll hinder customers and he’ll have to lay off his early morning crew.
Michael Hodges is the proprietor of Advance Financial 24/7. Prohibiting its operation from midnight to 6 a.m. is Councilman Jason Holleman’s proposal. Advance Financial is the only such business open all the time in Nashville.
Council was set to vote Tuesday on what the Chamber called “an excessive over-regulation of business [that] sets a worrying precedent in restricting hours in which any business can operate.”
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Chattanooga’s planning agency studied alternative financial services, concluding that more of them in one area “can have a detrimental effect on local property values and economic redevelopment, and … these establishments are particularly dangerous … when … providing services in the middle of the night when those services should not be needed.”
Several councilmen contacted about limiting predawn hours for cash advance stores are asking questions. What about automatic teller machines? Should their hours be limited? Aren’t ATM customers also at risk of robbery?
Holleman says it’s obvious that people leaving cash advance stores are carrying cash and likely targets for thieves, but that’s not his basic reason for his proposal.
He says the Chamber’s position issued Friday “more reflects the opinion of the Chamber staff … The Chamber may not see the forest for the trees … You don’t see positive growth in areas around these facilities.”
These facilities appear to be only one business, Advance Financial 24/7, which cashes checks, makes small loans and provides other financial services at all hours in Davidson County and Holleman’s proposal would force its closure from midnight to 6 a.m.
Yet the councilman explains, “Neighbors and others agree that these businesses don’t provide positive growth in these areas” that were discussed when land was to be rezoned for new development. Developers have agreed to not have cash advance businesses as tenants, he said, referring to a discarded bill that would have required a certain distance between cash advance shops. He didn’t sponsor that bill, but says he’s just trying to improve corridors such as Charlotte Avenue.
Improving Charlotte Avenue has been one of Holleman’s priorities, he said. It’s increased the tax base there. Furthermore, the perception of cash advance businesses is poor, because they’re seen as predatory lenders, charging high rates for small loans.
Councilmember Erica Gilmore: separates the issues; sees Holleman’s proposal as aimed at Advance Financial 24/7; and disputes any perception that a vote against Holleman’s bill supports high interest rates for small loans.
“Some might think we [council members] are supporting check cashing businesses” if they vote against Holleman’s bill, Gilmore said. “That’s not the issue. This does not address that. You don’t normally regulate hours of operation. Those are two different things. This bill does not address rates.”
Holleman’s bill targets one business and isn’t helpful to the community, she said.
Councilmember Edith Langster is one of several co-sponsors and she’s “99.9 percent” sure she’ll vote with Holleman because they, “and a lot of citizens think it’s a danger to have a lot of cash on you” after leaving a cash advance store. “There’s a chance that you could be stabbed, shot, run over by a car … if you go in and people know you have money.”
Langster’s received “a whole lot of letters, emails,” and phone calls about the proposed ordinance she said. Public sentiment is “50-50,” she said.
“I would be afraid to go into a check cashing place at any time of day,” she said. “You can get hurt any time of day.”
“The crime issue,” Councilman Charlie Tygard says, “is a smokescreen. There’s no evidence of that.”
So, where did the proposal come from?
“A lobbyist brought it to Holleman,” Tygard said. “I can’t prove that, but I have been told that.”
Holleman disputes that, but he did speak with one about cash advance businesses, he said.
The lawyer appears to be James Weaver of the firm Waller Lansden Dortch & Davis. Weaver’s replies to requests for comment were limited to text messages.
Without naming Weaver, Holleman said, “The conversation came up in context with a previous bill on the location of check cashing businesses, and there were businesses that were already in the process of getting an OK [to establish such a service] and then there was a conversation on businesses and interest in proposing a bill.” Holleman then speaks of image issues and redevelopment.
Weaver is a registered lobbyist for Buckeye Check Cashing of Tennessee, a Delaware limited liability company that’s authorized to do business here as Checksmart and Easy money, according to public records.
Weaver was asked to comment on Holleman’s proposal to limit the hours of cash advance stores. “My client is neutral on the bill,” he replied by text message, “so I don’t have anything to add.”
Weaver has many clients.
Councilmember Emily Evans says, “The rumor mill is filled with suggestions on why” Holleman sponsored the bill… My presumption is that this bill is designated to interfere with Advance Financial for a competitor, so those that don’t operate 24/7 could be more competitive … but I don’t have any basis with which to say why.”
There was at least one other bill related to Holleman’s to limit cash advance business hours — other than one to require a certain distance between such services. It’s an amendment to distance regulations to provide an exemption for services that leased property and/or obtained land use rezoning to establish a cash advance business, but have not yet opened.
Official acknowledgement of common law grandfather rights is apparently no longer an issue. The separation requirement was resolved administratively, Holleman said. And he’s deferred the grandfather rights bill.
Hodges counters: deferring a bill doesn’t kill it forever. “It can be brought back up,” Advance Financial’s owner said.
Hodges was “on a manic surge for about a week,” since he realized Holleman’s proposal would adversely affect his business, the proprietor said.
Evans knows. Hodges “has called most of the council by now,” she said Friday, anticipating serious changes to Holleman’s bill, if it’s to survive.
“The title loan part will have to be removed because state law prohibits local government interfering with the operation of title loan companies,” Evans said.
She’s against limiting cash advance business hours because it’s complicated and other businesses might be affected. Evans raises a question about a grocery shopper paying for food with a check made out to more than the cost so cash may be received in change.
“It seems a little unfair to Advance Financial, and the people who use it, to say you can’t use that, but you can use ATMs,” Evans said.
She would like information from police on whether crime is a problem around cash advance businesses. Now, she seems to feel this is a solution to a nonexistent problem.
She, Tygard and Councilman Buddy Baker oppose the bill. “It’s going to cost people jobs,” Baker said. The proposed ordinance “is, from my understanding, being brought by folks from out of state and we don’t need out of state people coming here. We need local people to hire local people. That’s what Mr. Hodges is doing; if he’s open 18 hours a day, why not the other six?”
Hodges explained last week that African American women are the majority of his employees in Nashville and if he must close between midnight and 6 a.m. 150 would lose their jobs and 150 would have their hours reduced. Holleman questions whether that’s realistic.
As for Holleman’s bill, “I hope it does get beat,” Baker said.
Tygard agrees: “I’m hopeful that the majority of the council will see that this is a bad idea… I’ve served a total of 20 years on the council and have never been asked to control the hours of a business like that.”
Rock quarries, however, can’t blast at night, Tygard said.
“Many of [Advance Financial’s] clients are not affluent and may not have access to debit cards or ATM cards, but if they have an emergency at night and want to do business with that company, they have the right to do so and no one is forcing them to do so.
“We’re on the second of three [votes if the bill is to pass.] There’s no public hearing like zoning” issues, Tygard said. “It could pass 8-5 with 25 abstentions [on the second vote] but on the third and final vote, it would require 21 of 40 to pass.”
Hodges said he’s been told few bills fail on a second vote.